Do not stand up or unfasten your seatbelts.
Güven Sak, PhD
04 November 2011
Turkey will be affected by the crisis as much as Europe, regardless of the future direction of the crisis in the latter. This is what the cabin crew says when there is turbulence during your flight: “Please do not stand up or unfasten your seatbelts.” For your safety, of course. We are going through a period in which everyone must be more cautious. The decision of Greek President Papandreu to hold a referendum on the economic measures to be applied to Greece has shaken Europe. They are treating Greece like an “ungrateful cat.” You’ve probably been watching the developments, too. Europe expects that if the Greek people say “no” in the referendum, the economy will be affected negatively. The consequence of this for Europe will be even stronger turbulence. This is the first point to state. Tu
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How to recover from a gastric disease?
Fatih Özatay, PhD
03 November 2011
Papandreu has manoeuvred successfully against both Sarkozy and Merkel and the Greek people. Across the sea are Kalymnos and Leros islands. There is no visible cargo boat traffic. Is there inertia across our neighbour, Greece? Or is it like this in this time of the year? This makes me wonder if there is any data on “seasonally adjusted cargo boat traffic in Greece”! There is no need for data, anyway. Everyone knows that Greece is in a recession for years. We do not need data on cargo boar traffic on two small Greek islands to validate the recession. These lines might push the limits of courtesy given the circumstances facing our neighbour lately. So, let me ask another question: How would Greek people vote if Papandreu actually held a referendum?
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The TSK and the PKK fight - 2
Nihat Ali Özcan, PhD
03 November 2011
In the fight against the outlawed Kurdistan Workers’ Party (PKK), it is the political establishment that determines the role of the Turkish Armed Forces (TSK) like all other government bodies. For example, according to the political authority, the existence of 6,000 armed militants in Turkey’s mountains and within the borders of a neighboring country and subsistence of active terrorist networks and sympathizers in its cities are just ordinary security problems. The police forces, certain parts of the gendarmerie units and only the TSK units responsible for the border ranging like a strip can overcome this “ordinary security problem.” If the political authority needs, it may temporarily authorize the TSK in exceptional circumstances.
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One variable today, another tomorrow
Fatih Özatay, PhD
01 November 2011
What matters is the impression created by the CBT that the variables that matters changes continuously and the uncertainties raised in such an environment. It is useful to put emphasis on the objective-tool issue once again. For some time now, inflation targeting is cursed and a new monetary policy regime to replace it is being sought. However, the necessary institutional structure is not ready yet. So, today let me try to express myself in the context of the inflation targeting regime at the risk of ending up with a “technical” assessment. In the inflation targeting regime framework, the main objective is to maintain price stability. Any other objective is secondary and comes to the agenda provided that it does not contradict with the main objective. There is a single main poli
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Crocodiles swim in the streets of Bangkok
Güven Sak, PhD
01 November 2011
We are not alone. There is another country that can compete with Turkey in incompetence: Thailand. It seems that “it was the best of times, it was the worst of times” in 2011 for Thailand. Just like for Turkey. In July 2011, the World Bank announced that Thailand, with its US $4200 per capita income, had been upgraded from a lower-middle income country to an upper-middle income country. Again, just like Turkey. In August 2011, elections in Thailand overthrew the military rule. Yingluck Shinawatra, born in 1967, became the first female leader of the country and the youngest political leader in the previous 60 years. However, the monsoon rains have been heavier than expected. Crocodiles have been seen swimming in the streets of Bangkok, just as they had in the nineteenth century. Harry Park
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New decisions from Europe
Fatih Özatay, PhD
29 October 2011
Even less critical accounts stress that the plan can only save time for the European leaders. The decisions Eurozone leaders announced on October 27 towards morning initially received a positive reaction from the markets. This tendency is continuing while I am writing these lines, on Friday morning. On the other hand, the views of some experts renowned across markets as well as of academicians who recently have been making important assessments on the crisis in the European Union were not in line with that of markets. The decisions announced can be summarized as follows:
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The mother of all problems
Güven Sak, PhD
29 October 2011
Are you following the organizational mess surrounding the earthquake in Van? Those coordination failures highlight Turkey’s underlying problems. What, really, is the mother of all problems in Turkey? The Kurdish issue comes to mind, doesn’t it? Or the Armenian question, perhaps? I don’t think that these 19th century leftovers will challenge Turkey in the first half of the 21st century. The challenge is the economy. Let me explain: The challenge lies in the country’s institutional capacity in preparing the grounds for a new beginning. Turkey will either rise to be a high-income country or get trapped in its current middle-income state. But all reforms that can contribute to the former outcome have been postponed these past 10 years. Not ideal for a new beginning.
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Turkey has made no progress since 1999
Güven Sak, PhD
28 October 2011
The Van earthquake has revealed that Turkey is still a developing country. There are two types of countries in the world: those with developed organization capacities and those with none. The ones in the first group are called developed countries; those in the second group are called developing countries. The Van earthquake has revealed that Turkey is still in the second group. There was no considerable improvement in the organization capacity of Turkey from the Marmara earthquake of 1999 to the Van earthquake of 2011. At least this is the conclusion I have drawn from what the Van earthquake suggests. The earthquake has upset all of us, but this sorrow should not overshadow our ability to make a rational assessment. Let me state three points first and then explain how I reached the above
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The TSK and the PKK fight - 1
Nihat Ali Özcan, PhD
27 October 2011
One of the most important factors affecting civil-military relations in Turkey has been the ongoing fight against the outlawed Kurdistan Workers’ Party (PKK) for the last three decades. More often than not, governments were criticized for delegating their responsibilities to the Turkish Armed Forces (TSK) and losing their capacity to manage the problem and make policy. Nowadays, the TSK’s role and responsibilities in the fight against the PKK have diminished significantly. However, comments in media outlets about increasing military casualties and the TSK’s silence are an indication of a serious lack of information. The purpose of this article is to examine the fight against the PKK and the TSK’s role. This article will have two parts. I will first take a look at the broader picture. Next
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Having multiple purposes
Fatih Özatay, PhD
27 October 2011
A month ago, the CBT was talking about the possibility of an expansionary monetary policy. However, a step on the opposite direction was taken. Tuesday morning I spoke at a news program at CNBC-e. I talked with Servet Yıldırım on the new action plan the Central Bank of Turkey (CBT) was to announce on Wednesday. It was difficult to be concrete due to contradictory statements delivered after the last four Monetary Policy Council meetings. There existed a radical difference between the results of the first three Council meetings and those of the last one. Therefore, I commented, “I, as a former central banker, do not understand what the CBT is trying to do.”
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